This week, ferrous metals fluctuated at highs, with raw material ore and coking products outperforming steel. Against the backdrop of the escalating conflict in the Middle East, ore and coking products held up well, supported by higher shipping costs and transmission from coal and coke as energy substitutes. In the second half of the week, supply and demand data for hot-rolled coil and rebar were released. The increase in rebar inventory slowed markedly; however, hot-rolled coil demand was lower than the same period last year, and the pace of post-holiday recovery was relatively slow, leaving steel as a whole with limited upward momentum, while futures retreated after rapid rise. In the spot market, trading in the Chinese market was average this week.....

[SMM Daily Brief Review on Coking Coal and Coke] In terms of supply, most coke producers still faced slight losses, suppressing their willingness to increase production, and overall supply remained temporarily stable. Meanwhile, shipments from coke producers improved, and coke inventory continued to destock. Demand side, blast furnaces at steel mills resumed operations and production, and hot metal production is expected to increase. In addition, steel mill profits improved somewhat, and finished steel shipments recovered, boosting steel mills' production enthusiasm. However, downstream buyers mostly maintained just-in-time procurement and lacked willingness to purchase for restocking. In summary, the supply-demand imbalance in the coke fundamentals still existed, and the coke market may remain stable next week.

[SMM Daily Brief Review of Coking Coal and Coke] In terms of supply, after the Two Sessions concluded, operating rates at coke producers increased somewhat, and shipments improved. Inventory pressure eased for most coke producers, with supply remaining stable while increasing slightly. Demand side, blast furnaces in Hebei resumed operations and production, and hot metal production is expected to increase. In addition, steel mill profits improved somewhat, and finished steel shipments picked up, boosting steel mills' production enthusiasm and strengthening their purchase willingness for coke. Overall, coke fundamentals improved, but the market remains in a wait-and-see mode, and the coke market may remain stable in the short term.

[SMM Coking Coal and Coke Daily Brief Review] In terms of supply, coking costs increased and losses widened somewhat. At present, coke producers were barely maintaining normal operating rates, while coke production remained temporarily stable. Meanwhile, downstream demand for coke increased, and coke producers' shipments improved somewhat. On the demand side, steel mills were in an active phase of resuming production, while finished steel prices fluctuated upward and steel mill profitability improved somewhat, boosting production enthusiasm and increasing demand for coke. In summary, the fundamentals of coke supply and demand developed in a positive direction, and the coke market may remain generally stable with slight rise in the short term.

Stainless steel spot prices were stable this week, but production costs rose somewhat, further squeezing stainless steel mills’ profit margins. Taking 304 cold-rolled products as an example, based on raw material prices on the day, the full-cost profit margin was -1.27% this week; calculated based on raw material inventory costs, it reached 2.21%. Nickel raw material cost side, high-grade NPI prices edged up further this week. Although a major stainless steel mill recently set relatively low procurement tender prices for high-grade NPI, strong nickel ore prices continued to provide solid cost support for NPI, traders showed strong willingness to hold prices firm, and the overall market remained bullish. Coupled with high stainless steel production schedules in March, downstream stainless steel mills maintained strong raw material demand, and the psychological price level also moved up gradually. In the short term, high-grade NPI prices were more likely to rise than fall. As of this Friday, high-grade NPI with a grade of 10-12% rose by 6.5 yuan per nickel unit to 1,094.5 yuan/nickel unit. Stainless steel scrap market side, stainless steel scrap prices strengthened this week, mainly due to the linkage with furnace charge, economic advantages, and demand support. Firm high-grade NPI and high-carbon ferrochrome prices boosted steel scrap prices higher. Stainless steel production schedules are expected to increase in March, boosting procurement demand. Stainless steel scrap still had an economic advantage over high-grade NPI, supporting bullish sentiment. However, downstream demand recovery remained limited, stainless steel social inventory stayed high, and finished product prices lacked momentum for further gains, constraining upside room for steel scrap prices. Overall, the market showed a pattern of “rising prices, raw material support, and demand under pressure,” and prices are expected to remain generally stable with slight rise going forward. As of this Friday, the price of 304 off-cuts in Shanghai rose by 600 yuan/mt to around 10,250 yuan/mt. Chrome raw material cost side, high-carbon ferrochrome prices rose slightly this week. Overseas market chrome ore futures prices continued to climb, and China chrome ore spot quotations moved up in tandem. Ferrochrome smelting costs increased, ferrochrome producers’ profits narrowed significantly, and with retail spot supply of high-carbon ferrochrome remaining tight and stainless steel production schedules staying high in March, ferrochrome prices were supported to edge up further. As of this Friday, high-carbon ferrochrome prices in Inner Mongolia rose 50 yuan/mt (50% metal content) WoW to 8,650 yuan/mt (50% metal content).

[SMM Stainless Steel Daily Review] Easing Geopolitical Sentiment Supports Base Metals; SS Futures Hold Up Well and Fluctuate Upward SMM News on March 10: SS futures showed a hold-up-well, rangebound pattern. US President Trump said regarding the situation related to Iran that “the war is about to end,” which supported base metals futures and led to signs of strengthening. SS futures also rose in tandem, closing at 14,265 yuan/mt by the midday close. In the spot market, driven by stronger SS futures, traders turned more optimistic and confidence improved, with fewer low-priced supplies in the market. Downstream end-users still mainly made just-in-time procurement, and overall transactions remained steady. The most-traded SS futures contract fluctuated downward. At 10:15 a.m., SS2604 was quoted at 14,310 yuan/mt, up 100 yuan/mt from the previous trading day. In Wuxi, spot premiums for 304/2B were in the 210-410 yuan/mt range. In the spot market, Wuxi cold-rolled 201/2B coils were generally stable; for cold-rolled trimmed-edge 304/2B coils, the average price in Wuxi was stable and the average price in Foshan was stable; cold-rolled 316L/2B coils in Wuxi were stable; hot-rolled 316L/NO.1 coils in Wuxi were quoted stable; and cold-rolled 430/2B coils in both Wuxi and Foshan were stable. As the traditional peak consumption season of “Golden March and Silver April” begins, the stainless steel market is entering a window for demand recovery. Downstream demand is gradually returning as market participants resume work and resume production after the Chinese New Year holiday, but although transactions improved compared with the earlier period, the bustling peak-season momentum has yet to emerge. End-user procurement remains mainly just-in-time, and stockpiling willingness is relatively low. On the futures side, driven by risk aversion triggered by geopolitical conflicts...